Netflix Upgraded, AMD Downgraded: Wall Street's Top Analyst Calls

Netflix (NFLX) and Advanced Micro Devices (AMD) have been in the spotlight recently, with Wall Street analysts making significant calls on their stocks. Netflix received an upgrade, while AMD faced a downgrade, highlighting the contrasting fortunes of these two tech giants.

Netflix's upgrade comes on the heels of strong subscriber growth and expanding ad revenue. The streaming giant added 10 million subscribers in the fourth quarter of 2024, driven by its expanding content library and the success of its ad-supported tier. With 70 million monthly active users on its ad-supported plan, Netflix is projected to hit 120 million by late 2025. This growth, coupled with positive analyst sentiment, has led to an average target price of $810.45 from 29 analysts, implying a 2.43% upside.



On the other hand, AMD's downgrade raises concerns about the company's ability to compete in the AI chip market, particularly with Nvidia (NVDA). HSBC analysts lowered their fiscal 2025 AI GPU revenue forecast for AMD to $8.1 billion from $12.3 billion, well below the $9.5 billion analyst consensus. This suggests that AMD may struggle to gain market share in the AI GPU segment, where Nvidia currently dominates. The downgrade also highlights potential challenges for AMD in penetrating the AI GPU market and competing with Nvidia's offerings.



The increased competition in the AI chip market could have several implications for AMD's future growth. HSBC analysts believe there remains further downside to AMD's stock price, which has already lost about 24% over the past three months. Additionally, the analysts expressed concerns about a potential slowdown in demand for PC processors in the first half of 2025, which could further impact AMD's growth in this segment.

Despite these challenges, AMD could still expand its position in the CPU market as Intel undergoes a likely restructuring, and benefit from Nvidia AI chip supply constraints. However, these opportunities may not be enough to offset the impact of increased competition in the AI chip market.

In conclusion, Netflix's upgrade reflects the company's strong subscriber growth and expanding ad revenue, while AMD's downgrade highlights the challenges the chipmaker faces in the competitive AI chip market. As investors, it's essential to stay informed about these developments and make informed decisions based on the latest analyst calls and market trends.